NEW YORK (TheStreet) -- Can the United States learn anything from the events that are currently taking place in Europe?
Yes: Hard policy decisions must be made if the U.S. is going to continue to play a leading role in the world.
The situation here is not unlike the one faced by that world famous philosopher Winnie-the-Pooh when he was confronted with the question: "Milk or honey with your bread?" The answer he gave was, "both."
Since the 1960s, the United States government has tried to get away with not having to make hard choices dividing demands on its resources. The specific problem faced in that decade was one of "guns or butter," as the choice between investment in defense and civilian goods was known.
More specifically, President Lyndon Johnson, after pushing through the most ambitious social program in United States history also had to contend with financing the Vietnam war.
Johnson's choice was "both," both "guns and butter."
Subsequent U. S. presidents have not backed off from his decision. What has followed is some fifty years of presidents that have chosen to address both global issues and social issues at the same time.
And, the United States with all of its wealth and resources, up to this point in time, has pretty well gotten away with it. The government has continued to provide a substantial social network of programs while supporting the leading economy of the world and maintaining its military leadership.
The only economic variable that showed any sign of this stress has been the value of the dollar, which, in the face of all this government spending, had to be set free in August of 1971 from the international monetary rules formed at the end of World War II. It then proceeded to fall in value by more than a third, reaching a low in 2011.
However, times are changing and in these new times, some hard decisions are going to have to be made.
This is what is coming out of the current events taking place in the Europe. Countries are having to make hard decisions that are really painful to many of their citizens.
The Eurozone is trying to make its way into the very competitive global economic environment of the twenty-first century. Germany has taken on the leadership role and is attempting to bring together first a currency union, and then a political union, that will create a trading bloc that can be competitive in a world dominated by the U.S. and China.
Germany could go it alone if it had to, but it has chosen to work with others in the Eurozone to build a united band of nations that are efficient, productive, and competitive enough to be one of the three major players in the world. Building such a trading bloc will give the Eurozone the scale and political clout to stand up to these two giants.
This is one reason why several European nations chose to join the Chinese-led Asian Infrastructure Investment Bank, even against the wishes of the United States -- power and influence on a world stage.
Creating such a union is a hard job because most of the nations within the Eurozone must make major efforts at reforming and restructuring their social relationships as well as their ways of doing business. And, this is very hard. Just ask France, Italy, Spain, Portugal, Ireland, and, now, Greece.
But, the legacy systems of the past cannot continue to exist in the world the leaders of the Eurozone are aiming for. Decisions have to be made.
A primary example of this is situation that exists in France. Recently it has been stated that French President François Hollande has had to decide between the two ideological wings of his Socialist party: between those who embraced globalization and a business-friendly approach to policy and those who wanted more public spending and social-orientated policies.
Hollande chose to go with Germany and others in the European and chose the former. This has created much discomfort within his socialist party, but Hollande believes the future lies in France being globally competitive.
This is where the United States needs to sit up and take notice. The global economic world is going to become more and more competitive as the twenty-first century moves along. China and the European Union are planning to challenge the United States. And, there are others, like India, Brazil, and Argentina that would also like to play at this level at some time in the future.
The United States is not going to have the stage by itself. Consequently, it, too, must make a decision about whether or not it will give more emphasis than it has toward creating a stronger, more productive, more competitive economy.
The answer "both" will not work.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.